Tag Archives: banking

Kazakh bank unveils strategy

JAN. 26 2016 (The Conway Bulletin) — Kazkommertsbank, one of Kazakhstan’s largest lenders, said in a statement that it is working with international consultants on developing a new business strategy to improve the quality of its assets after a merger last year with the debt-ridden BTA Bank. Earlier this month, ratings agency Fitch downgraded Kazkommertsbank’s long-term credit to CCC from B- because of the fall in the value of the tenge.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Azerbaijan’s Central Bank to compensate savers

JAN. 28 2016 (The Conway Bulletin) – Azerbaijan’s Central Bank said it would compensate customers of banks who lost savings in banks which have been stripped of their licences over the past couple of weeks. Legally, the Central Bank is only obliged to compensate up to 30,000 manat ($18,400). Around 6,600 customers will be eligible for the refund.

ENDS

(News report from Issue No. 265, published on Jan. 29 2016)

Business comment: Wealth fund critics come out

JAN. 22 2016 (The Conway Bulletin) — At the end of December, Berik Otemurat, a senior official at Kazakhstan’s Central Bank, picked up the phone and called several newspapers to speak out against the way the sovereign wealth fund was being managed.

He was promptly sacked after his quotes started populating articles. He had said that Kazakhstan’s sovereign wealth fund to be doomed.

Mr Otemurat’s argument was that the sovereign wealth fund was risk averse and that it was pilfering away its cash on low yield investments making low returns.

Low oil prices and the economic slump would combine, he said, to wipe away the fund’s reserves in 6 to 7 years.

Timur Kulibayev, President Nursultan Nazarbayev’s son-in-law and powerful businessman, spoke out against Kazakh money managers to but he’s not in any real danger of losing his job.

He has criticised for months the behaviour of the Central Bank and, effectively, said their management of the economic crisis has been poor.

Mr Kulibayev repeated his criticism last week. His bottom line was: “The government cannot continue spending its reserves to prop up the tenge or the reserves will be extinguished in three years.”

Of course, Mr Kulibayev, the second-richest man in Kazakhstan, is in a much stronger position than Mr Otemurat, so his words will not make him a pariah of the elite. This parallel goes to show that there are only few people who can speak out against Kazakhstan’s economic policy and face no consequences.

The managers of the sovereign wealth fund have said they will change their policy this year. Let’s see if they can stop the drain.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Armenia’s bank wants IPO

JAN. 22 2016 (The Conway Bulletin) – Armenia’s biggest bank Ameriabank said that it would seek an IPO in London within the next couple of years after the European Bank for Reconstruction and Development (EBRD) bought a stake in it. If Ameriabank did list in London it would be the first Armenian company to list on a Western stock market.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Fitch downgrades Kazakh kommertsbank

JAN. 19 2016 (The Conway Bulletin) — Ratings agency Fitch downgraded Kazkommertsbank’s long-term credit to CCC from B- because of a fall in the value of the tenge. Fitch said: “The downgrade reflects a significant increase in the volume of problem (mostly foreign currency-denominated) exposures, primarily as a result of the tenge’s devaluation.”

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

2nd Mortgage protest takes place in Kazakhstan

JAN. 20 2016 (The Conway Bulletin) – Around 100 women covered in grey sheets marched in protest to Kazkommertsbank and Bank Center Credit to complain about how they treat mortgage holders, their second protest this month. The protesters said that they have struggled to pay their debts since the the tenge lost 50% of its value during a devaluation in August. The authorities in Kazakhstan fear economic problems will trigger social discontent.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Armenia’s Ameriabank aims for London IPO within 2 or 3 years

JAN. 21 2016 (The Conway Bulletin) — Ameriabank, Armenia’s largest bank, said it wants to list its shares on the London stock exchange, after it received an investment of around $100m from international lenders, including the EBRD and the World Bank’s IFC.

If Ameriabank does list on LSE, it would be the first Armenian bank, or company even, to be publicly traded on a Western stock exchange. In the South Caucasus it would be the second publicly traded bank after Bank of Georgia.

Ameriabank’s chairman Andrew Mkrtchyan said the bank plans an IPO in the next two or three years.

“Our aspiration is an IPO (initial public offering) and to try to triple our balance sheet in the next three years,” Mr Mkrtchyan told Reuters.

The EBRD said it paid $30m for an equity stake of around 20% in Ameriabank and has pledged an additional $10m for the bank’s asset growth.

“This is the largest single-ticket equity deal the EBRD has signed in the region to date,” the EBRD said in a statement.

By becoming a shareholder, the EBRD has committed to growing the bank in Armenia.

“As a shareholder the EBRD will support Ameriabank’s development, with a special emphasis on corporate governance,” Mark Davis, head of the EBRD Yerevan office, said.

The World Bank’s IFC also provided Ameriabank with a $50m loan to increase its lending capacity.

For Armenia, the investments by the EBRD and the IFC are a vote of confidence in its banking sector and are especially important at a time when currencies and economies in the region are depreciating or falling back on earlier growth spurts.

For foreign investors, an Ameriabank IPO would give them a chance to buy into an Armenian corporation for the first time.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Kazakhstan’s Tsesnabank makes Russia deal

JAN. 13 2016 (The Conway Bulletin) — Tsesnabank, one of the largest banks in Kazakhstan, bought an 83% stake in Russian Plus Bank, after both countries’ Central Banks gave the green light for the deal. According to Russian law, Tsesnabank will have to submit another offer for the remaining 16.7% of Plus Bank over the next days. UAE-based Linex Global owns 14.7% of Plus Bank. Tsesnabank has increased its stake over the past six months. In June 2015, it owned 20% of Plus Bank. It has since bought out several other minority shareholders. Adilbek Dzhaksybekov, mayor of Astana, owns Tsesnabank.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Kazakh mortgage holders protest

JAN. 12 2016, ALMATY (The Conway Bulletin) — Around 100 people demonstrated in Almaty, Kazakhstan’s financial capital, over the rising cost of servicing US dollar mortgages, an indicator of growing discontent over the worsening state of the Kazakh economy.

The protesters targeted two banks — ATF and Forte Bank — which they said were refusing to help homeowners with US dollar mortgages despite a 50% drop in the value of the Kazakh tenge. They carried a symbolic coffin filled with underwear and ripped up mortgage statements.

Sulubike Zhaksylykova was on the march. She is head of an NGO which is lobbying for banks to help mortgage owners.

“One of the main goals of the protest is to refinance mortgages in dollars according to people’s ability to pay,” she told The Conway Bulletin.

“There are many disabled people of first and second category who receive 26,000 tenge per ($71) month [of government benefits] and these banks require them to pay 100,000 tenge a month [in mortgage repayments].”

The Kazakh government last year released a 130b tenge ($355m) cash-pot which it handed to commercial banks to help them refinance homeowners’ mortgages. Ms Zhaksylykova, though, accused the banks of not doing enough to help people.

After the protest both ATF Bank and Forte Bank said they would work to improve individual mortgage repayments.

Public protests in Almaty are rare but as the economy worsens, emotions are running high.

The Kazakh economy has always had relatively high levels of household debt and after the Global Financial Crisis of 2008/9, Kazakhstan had one of the highest proportions of non-performing loans.

Analysts have now warned that bad mortgages may be the source of another debt crisis.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Kazakh businessman ups Kazkom stake

DEC. 29 2016 (The Conway Bulletin) — Kenes Rakishev, son-in-law of Kazakh defence minister Imangali Tasmagambetov, became the majority shareholder in Kazakhstan’s largest bank, Kazkommertsbank, after he completed his purchase of investment group Alnair Capital Holding, media reported. Mr Rakishev will now own, directly and through Alnair, 56.75% of Kazkommertsbank. Alnair had been linked to the Kazakh elite.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)